Progress

No less than 20,000 English girls … married American soldiers and sailors … . Some of these girls are being educated for their life in a new country at the â€˜Schools for Brides of U.S. Servicemenâ€™ organized by the American Red Cross. Here they are taught practical details about American manners, customs and traditionsâ€”and also, perhaps, cured of the widespread illusion that every American owns a motor car and every American house contains a bathroom, a refrigerator and an electric washing-machine.

Imagine such luxury! Houses with bathrooms, and even refrigerators!

I can’t entirely agree with Scott Winship: people acclimate to living standards, so the growth rate matters as well as the absolute level. And stagnation makes the world look more zero-sum, which is likely to make politics difficult. (Since “loss aversion” makes any reduction especially painful.) Still, it’s worth remembering that, as Keynes predicted, the sheer urgency of the economic problem declines with absolute income, and absolute income has grown enormously.

Still, itâ€™s worth remembering that, as Keynes predicted, the sheer urgency of the economic problem declines with absolute income, and absolute income has grown enormously.

Be that as it may, despite all the cars and indoor toilets please note Mr. Bellmore’s quote from an earlier Wimberley post:

I really doubt that the USA of 2013, with such a huge percentage of itâ€™s population in prison, and laws regulating so many aspects of our behavior, would be considered by the founders to be a â€œfreeâ€ state.

Verily. Our forefathers, chewing with wood teeth and being bled to death by physicians would be simply appalled at our lack of freedom here in the mean lean days of 2013. Why we don’t even have slaves to do our laundry and pick our cotton! Oh the horrors of modern America libertarians in manacles. Why I bet they are just chomping at the bit to go Galt….

I think Megan McArdle nailed it by suggesting poverty is basically the inability to escape living close to several bad neighbors. Your bike and fancy grill will be stolen, you’ll enjoy drunken arguments outside on your street in the middle of the night, trash tossed in your yard, people knocking on your door at 11:30 asking for money. Your neighbors will abandon their mortgage and leave the place to become a local teen hangout. As Megan experienced, hoarders in your building may develop terrible bug problems that spill over into other units. So no, owning a nice dishwasher doesn’t make you rich.

But since in this sense “the ability to escape several bad neighbors” means “being able to afford to live in a neighborhood too expensive for poor people,” there’s no level of economic growth that will make everyone non-poor, since twenty percent will always be in the bottom quintile. To fix that problem, you have to change the social capital structure of poor neighborhoods. (In fact, there are lots of poor neighborhoods where the locals have it sufficiently together to discourage bad behavior.)

For those poor neighborhoods to get it together to discourage bad behavior, they need be able to trust the police to some degree. If there are major problems with the police, will the locals be able to dissuade the baddies with legal means alone, or will they need to resort to extralegal means?

To ask it another way: how much does â€œsocial capitalâ€ depend on the honesty, representativeness, and integrity of political institutions?

But since in this sense â€œthe ability to escape several bad neighborsâ€ means â€œbeing able to afford to live in a neighborhood too expensive for poor people”

I don’t think this is quite what it means, though. It’s entirely possible for a neighborhood, all of whose residents are poor, to be effectively intolerant of disruptive dysfunction. That was routinely the case 50 years age. AS Megan said–it’s not that poor people are more likely to be dysfunctional, but that dysfunctional people are more likely to be poor. There used to be an large assortment of (frequently abused and abusive) ways for neighborhoods to be poor, but “decent”.

What Megan McArdle is describing in her article is one aspect of social exclusion. While she does a good job of bringing this abstract concept to life, it’s not a new idea. It is one of the major reasons why relative poverty and inequality are considered problematic (i.e., they lead to social exclusion); in the UK, the Blair government even used social exclusion as the primary definition of poverty for a time. Also, with all due respect to Megan, social exclusion extends in practice to more things than just bad neighborhoods.

I also think she may be too dismissive of other aspects of poverty. While social exclusion is an important aspect, it’s not the whole story; similarly, there’s a lot more to be said about the causes of poverty (understanding, of course, that she may simply have been lacking the room to address these issues more fully).

In particular, she writes: I think it’s hard to disagree that the poor could stop being poor–at least as the US currently defines poverty–if they behaved differently; it’s basically numerically impossible to fall under the poverty line if you finish high school, wait to have children until you get married, and both work full time. On the other hand, as I wrote a while back, I think this ignores the evidence that when you are poor–“which is to say”, noted George Orwell of unemployed coal miners, “when you are underfed, harassed, bored, and miserable”–it is actually much harder to make those choices than Bryan seems to imagine.

I don’t disagree that a lot of poor people have trouble because they’re bad at managing their own lives (I know of too many examples myself). And I obviously agree with her point that despondency born out of poverty can certainly gnaw away at one’s will and ability to engage in self-improvement even where that is possible.

However, poverty is not quite as controllable as she claims it to be. Her statement is a fallacious inversion of the American dream: From “if you work hard and play by the rules, you can prosper” it does not follow that “if you don’t prosper, you didn’t work hard or didn’t play by the rules”. There are too many uncontrollable catastrophic events (e.g. illness) that disprove this thesis.

But even leaving catastrophic events aside, I think the two parts that I highlighted in bold do not quite work the way she thinks they work.

Let’s discuss high school graduation: Our high school graduation rate is currently around 80% and it was around 70% a decade ago [1]. High school graduation is one of the most significant predictors of a decent life in America (for example, your risk of unemployment is massively higher as a dropout). And I’m not buying that 20%-30% of Americans are simply too undisciplined to finish high school in a timely fashion (or at all) when other countries with comparable levels of affluence do not have such a problem with dropouts.

The underlying problem with our high school diplomas is that they are mostly a one-size-fits-all approach; they need to be inclusive enough to allow the majority to graduate, yet advanced enough to serve as a baseline for college readiness; these two goals are very difficult to reconcile without compromising on one or the other. This is very different from the typical European solutions, which tend to offer different secondary education degrees after 9, 10, or 12 years (details varying by country). Most importantly, the degrees you receive after 9-10 years of school are designed to allow a transition to an accredited vocational education and training (VET) system, to the point that some people opt for the VET approach over college. Overall, this leads to a much lower dropout rate (because the 9-10 year degrees are easier to attain, but still valued), a better VET story, and also more ambitious 12 year degrees (because not almost everybody is expected to have one). Similarly, college is not the do-or-don’t proposition that it is in America.

In contrast, our secondary school system is willing to throw a significant percentage of young people under the bus and erects an access barrier to the middle class in the form of expensive college educations. We should not really be surprised that these days our social mobility isn’t what it once was and that comparably affluent European countries beat us handily in that regard, given how critical secondary and tertiary education is for actual equality of opportunity.

As for “both working full time”, I recommend Elizabeth Warren’s “The Two-Income Trap”. Having both partners work full time is not necessarily as beneficial as one may think and may actually have adverse effects. Again, it can also be helpful to look at other countries for a contrasting view: While it is lamentable that with German couples it is almost always the father who is the primary breadwinner and the mother rarely works full time, it is worth remembering that this is only possible because Germans simply do not feel the same economic pressure to have two full incomes as Americans. Even without doing that, they can still vacation in Spain for a few weeks each year and send their children to college. (See also the first example of Keith’s recent post on social class and marital conflict.)

The other major point that I am in disagreement with is the dismissal of absolute poverty and the implicit assumption in the article that most, if not all, poverty in America is relative.

For example, when I was in Atlanta a few years ago, there were these prominent posters in the MARTA stations, advising commuters where to turn for help if they can’t pay their utility bills. There are too many Americans who do actually lack food, or cannot pay their electricity or heating bills or do not even have homes. These Americans have much bigger problems than just bad neighbors.

Now, this generally does not mean that people will starve or freeze to death; thankfully, this is a rare event in modern times (less so the consequences of not having health insurance). But poverty affects mortality regardless.

That said, I agree with Megan that you can’t just throw money at the problem and make it go away. For example, even though under German law every German citizen is entitled to healthcare, a roof over their head, heating, and enough money to lead a dignified if frugal life, Germany still has many homeless people and still has people dependent on food banks. Some people, as I wrote above, are simply bad at managing their lives; there are those who got thrown out of their homes by their partner or their parents, there are ex-convicts who are unable to resume a normal life, there are many still whose sense of shame does not allow them to ask for help. It’s a sad, multi-faceted problem with no easy solution, but that’s not the same as saying that the problem (i.e., absolute poverty) does not exist or that we shouldn’t try to address it. A functioning social safety net can counteract some of the vagaries of life, but it’s not a universal solution.

[1] These numbers do not include people who graduate more than four years after entering nine years, including getting a GED; on the other hand, they also include everybody with barely passing grades and not the most exciting future in the labor market.

On the other hand, as standards of living go up, ways of living change so that some things that were formerly luxuries do effectively become necessities. Someone living in an exurban subdivision without car or electricity could freeze or starve in fairly short order unless their neighbors take them in. And in urban areas in the summer, being the one without an air conditioner means not only the usual heat but also all the waste heat rejected into the ambient air by everyone else’s air conditioners.

I wish I could remember who it was, but a few weeks ago there was an interview on NPR with some entitled rich guy who, addressing the question of the widening gap between the rich and poor in the U.S., challenged the notion that there were any poor people in the U.S. in the first place. The thrust of his argument was that if you have a cell phone, you’re not really poor. The NPR piece then went on to talk to a woman who had a cell phone and was living in her car. Hey! She has a cell phone and a car! Prosperity!

The bottom line is that blindness to the future coexists with blindness to the past, and in both cases everyone (based on essentially nothing) imagines they’re an expert.
It would be nice if the same people who are eager to state “you don’t realize how much progress there has been in recent history” were willing to extent the same courtesy to Steven Pinker… Just saying.